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Skills shortage pushes up the bill for HS2

The National Infrastructure Plan for Skills sets out concerns that major infrastructure projects are threatened by the UK’s skills shortage, with a quarter of a million existing workers needing retraining and a gap of 100,000 workers over the next five years.

The report found that through growth in infrastructure investment, there was a demand for over 250,000 construction and over 150,000 engineering construction workers by 2020, with a shortfall of nearly 100,000 additional workers by the end of the decade.

This will also mean a need to retrain and up-skill around 250,000 of the existing workforce over the next decade in addition to the need to recruit new workers.

Programmes like HS2 will put further stress on the industry’s capacity to deliver, the report found. It said that as well as a deficit of skilled engineering construction workers, the railway industry faces challenges recruiting experienced managers in both project and commercial teams, with HS2 demand amplifying the problem.

The affect of the skills shortage is already having impact on rail schemes. Inflation in this sector is pushing up costs substantially and as HS2 comes on stream increased demand will inevitably exert even greater pressure on costs. It is estimated that the cost of HS2 goes up to £54.6bn at 2014 prices once you take labour inflation into account.

The DfT will, no doubt, keep to 2011 prices for the project but taxpayers won’t have the option of being able to be stay in this make believe world.